Product Launch and Manufacturing Insights: Cost Reduction Strategies for Injection Molds and Tooling

We're currently in the midst of several projects moving through the final design to tooling stages–a very iterative process in which companies are finalizing their product designs based on playing with prototypes, buyer/market feedback, and getting cost feedback from suppliers to make decisions on feature/cost trade-offs.  I thought I would write a post regarding some of the issues that have come up and offering a few insights into addressing the sizable up-front financial investment that building injection molds and tooling can pose to companies launching new products.

Companies can look at several different options to bring mold costs down: from design to financing. 

  • Product Design: A good product designer will design parts for cost-effective tooling, bearing in mind the part will be ejected from the mold, shrinkage rates, and dimensional tolerances.  If you have a source, or sources, that are great with customer service and will work with you to re-quote injection molds based on several design iterations, this can be very helpful in leading the industrial design to the optimal design/cost balance.
  • Mold Material:  Another consideration companies may wish to entertain with respect to lowering injection mold cost, is deciding whether to build the mold out of steel or aluminum.  Aluminum has been considered a low price way to get a production run in the thousands of units completed at 1/3 the cost of steel molds.  This article, Why Offer Aluminum Molds for Production, at MoldMakingTechnology, claims that, with proper creation and care,  aluminum molds can deliver production runs into the hundreds of thousands of units and beyond.  I'll let the engineers haggle it out over the feasibility of accomplishing this.  I can tell you that I've received quotations for aluminum molds from several vendors recently and they all cautioned against the potential corrosion that can occur with aluminum molds and the susceptibility of the material to damage given it's softness.  It's worth noting that fluctuations in the price of steel and aluminum material will obviously impact the mold cost.  Currently, in China, aluminum prices rival steel, and the savings previously found in aluminum molds has essentially been wiped out due to this. 
  • Mold Plan: In addition to material, one could consider different ways to layout a family of injection molds (assuming your plastic product might be composed of an assembly of parts).  Generally, each part cavity has its own mold base.  However, to reduce cost, one can consider a MUD base (sounds like a spa treatment, but MUD means "Master Unit Die"), in which the part cavity is an insert that can be dropped into the common MUD base.  Thus, only one mold base is created for all of the inserts, instead of bases being created for each insert.  This does increase the run-rate and part cost incrementally, but it can offer a notable cost reduction to reduce the up-front financial investment for new products.  Below are some pictures of a MUD base mold with two inserts:

SDC14435

SDC14436

  • Mold Financing: A company should never pay an entire mold fee up-front, and should instead break out the fee according to milestones in the mold building and tweaking process itself.  An up-front payment to begin work, a payment at first shots (the first parts they make off of the tools), and a final payment upon final shots approval (meaning you've approved the parts coming from the molds), is a typical structure.  Occasionally, vendors will be willing to amortize some or all of the mold costs into one or several orders.  The ability to do this will often vary from vendor to vendor, their financial situation, and hunger to obtain the business.  Bear in mind, that until a company has paid all of the cost of the mold, they do not yet own it.